CMA recommends independent regulation of legal services in Scotland
The Competition and Markets Authority (CMA) has recommended that an independent body regulate legal services in Scotland.
In a report published today, it also recommends that the Law Society of Scotland carry out a review of the impact of existing price and service transparency guidance, including whether mandatory rules could strengthen the information available and that alternative business structures be made possible since enabling legislation for ABS was passed a decade ago.
It also recommends the introduction of an independent body to regulate the legal profession, setting standards and handling complaints, as recommended by Esther Roberton.
The CMA said: “Separating regulation from representation will increase trust in this sector and result in better regulation.”
It encourages the Scottish government to implement the recommendations promptly, but said it recognises the challenges of the current environment and the impact of the COVID-19 outbreak.
As part of its research, the CMA engaged with organisations including the legal services regulators in Scotland, legal professionals and consumer bodies. The CMA also commissioned IFF Research to conduct a survey of solicitor firms in Scotland on its behalf last year.
Andrea Coscelli, the CMA’s CEO said: “It is important that people in Scotland have access to high-quality and good value legal services. In addition to increasing transparency of information, our recommendations are intended to introduce greater liberalisation that could foster growth and innovation in the delivery of legal services which would help the sector grow.
You might not need a lawyer very often but when you do it will often be at a crucial point in your life, so addressing regulatory and competition shortcomings will make a real difference.”
Scottish Legal Complaints Commission chief executive Neil Stevenson said: “The SLCC strongly welcomes the CMA report. It is an important contribution to the debate on the reform of legal services regulation.”
He added: “Transparent pricing and good consumer information can assist consumers in a market which can at times appear complex and confusing, and help avoid the misunderstanding and miscommunication that lead to so many of the complaints we see.
“They can also help grow markets, creating a strong and sustainable legal sector in Scotland. This in turn provides jobs, supports businesses and citizens, and contributes to a just society.
“We were pleased to have been involved as a stakeholder in the study and are now looking forward to working with the CMA and others, to take forward its recommendations to help consumers navigate the legal services sector and ensure a thriving and sustainable legal services market.”
President of the Law Society of Scotland John Mulholland said: “Our current number one priority is to support solicitors and their clients deal with the unprecedented challenge of coronavirus.
“However, we appreciate the CMA has published a detailed report and we will want to consider the content carefully over the coming months. Some of the recommendations around price transparency involve actions which we are already committed to taking forward at the appropriate time. We also agree that pace is needed around new introducing new alternative business structures. This may be one way to help firms access vital capital following the current crisis.
“On the issue of wider reform, the CMA started its work with a clear policy position in favour of creating a new regulatory body. So it is no surprise to see it reiterating that position. However, at this of all times, we must avoid creating complicated new structures which add little benefit and only serve to build in extra costs for legal firms. All this would do is increase prices for consumers and undermine the competitiveness of the Scottish legal services market.”
Roddy Dunlop QC, Vice-Dean of the Faculty of Advocates, said: “The Faculty notes the CMA’s paper and its suggestions which will require time to examine in detail.
“We are committed to playing a full and constructive part as the Scottish government takes forward its consideration of reforms to Scotland’s legal services.”